We’re two weeks into Medicare Open Enrollment season, and while things seem to be as confusing as ever, we’re going to throw one more element into the mix? If you are on traditional Medicare or are considering returning to it, have you thought about buying a Medicare Supplemental Insurance (Medigap) Policy?
If you haven’t thought about it in a while, here’s a little cheat sheet on Medicare Supplemental Insurance policies or Medigap and what they can do for you:
Filling the Gap-What are Medigap Plans?
Because Medicaredoes not cover all your healthcare-related costs during retirement, you may want to consider purchasing a supplemental health insurance policy called “Medigap.” Medigap plans are designed to fill some of the gaps in the coverage of Medicare Parts A and B such as the deductibles, co-insurance and co-payments.
Who would benefit from a Medigap Policy?
Medigap policies are most beneficial for seniors who need to bridge the co-insurance, co-payments or deductibles in the traditional government Medicare A and B plans. For example, if you have a long hospital stay, a Medigap policy can help you pay the hefty $275/day co-insurance that kicks in after the first 60 days in the hospital. Since Medicare HMO plans have limited co-pays and other gaps, Medigap policies generally aren’t as useful to seniors who are members of a Medicare HMO plan.)
What do Medigap Policies Cover?
Medigap policies must follow federal and state law. Under federal law, only fourteen standardized plans may be offered as Medigap plans, and all must cover certain services, no matter what state you may live in. These plans have different standardized benefit levels that have been set by the federal government. Because iInsurance companies that provide Medigap plans withcan only provide one or more of these twelve standardized benefit, they must and compete on price. For example, generally, Medigap policies cover most but not all Medicare coinsurance requirements.
A Medigap policy must be clearly identified on the cover as “Medicare Supplement Insurance.” It is important to compare costs because costs can vary. For ease of comparison, these fourteen plans are labeled “Plan A” through “Plan N,” with Plan A being the plan with the most basic and Plan N being the plan that is most comprehensive. Each plan, A through N, has a different set of basic and extra benefits, but the benefits of any Medigap Plan A through Plan N are the same for any insurance company. More comprehensive Medigap policies are likely to cover requirements such as deductibles and services not covered by Medicare such as preventive care. Read the fine print carefully to weigh the coverage and the cost of the plans. (Please note, that not every plan is available in every state.)
When should I Enroll in a Medigap Policy?
The best time to enroll in a Medigap policy is during your open enrollment period which generally is when you first six months after you enroll in Medicare Part B. (A few states also require that a limited open enrollment period be offered to Medicare beneficiaries under age 65.) Unlike Medicare Advantage or Medicare Part D prescription drug plans, there’s no yearly open enrollment period to buy a Medigap policy, however, so it’s completely up to the Medigap insurance companies as to what policies they’re willing to sell you and the prices they charge, depending on your age and health history. A few insurance companies, however, will sell certain Medigap policies at any time, regardless of your age or health status.
Are you considering a Medigap plan? Tell us about it!
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- Medicare Open Enrollment: 3 Secrets to Signing Up For Your Medicare
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